In Eagan and across the region, the market is finally starting to tilt in favor of sellers, rather than buyers.
So far this year, the median sales price of homes in Eagan has risen 6.4 percent, and the number of homes sold rose 12 percent compared to the same period last year, according to quarterly market statistics provided by the Minneapolis Area Association of Realtors. The association tracks trends in the real estate industry and releases monthly reports for communities across the Twin Cities area.
A total 410 homes were sold in Eagan during the first six months of 2012, compared to 366 for the first half of 2011, the report said. The median sales price for those homes was $175,500, compared to $165,000 at this point last year.
During the first half of 2011, a home remained on the market for an average of 141 days before selling, according to the report. But that number dropped to 117 days in the same period in 2012. The months supply of inventory of homes for sale in Eagan—widely considered a barometer for the level of supply and demand in the local housing market—has declined from 6.8 months in June 2011 to 3.5 months in June 2012.
The trends occurring in Eagan's local market are mirrored on a larger scale across the Twin Cities region, where the median sales price in June 2012 rose 10.7 percent from the previous June to $179,500.
That’s the second-largest annual gain since January 2004 and the fourth consecutive month of year-over-year gains. Excluding only June 2010, home prices in the Greater Twin Cities area are now at their highest level since Oct. 2008.
That's a result of declining supply, as well as rising demand. In June 2012, buyers signed 4,917 purchase agreements, 16 percent higher than June 2011. Meanwhile, the number of homes for sale has dropped for 17 consecutive months, down 31.2 percent from last year to 17,103 active listings–the lowest inventory reading for any month since January 2004. Months’ supply of inventory, a standard industry measure of inventory, dropped 44.6 percent to 4.4 months, the lowest reading for any month since December 2005.
Realtors cited several other bits of good news from the close of the second quarter: Homes are selling in 113 days, on average, down 22 percent from last year. Sellers are getting an average of 95.1 percent of their list price, up 4 percent from last year. And cash buyers are making up 19.3 percent of all closed sales.
Perhaps most significantly, people putting their homes on the market no longer have to compete with quite such a huge flood of short sales and foreclosures, collectively known as "distressed sales." In June, distressed sales accounted for 30.6 percent of all new listings and 34.6 percent of all closed sales, the lowest shares since June 2008 and August 2008, respectively.
“It’s difficult to find a negative trend in the local housing market right now,” Cari Linn, MAAR's president, said in a news release. “After many years of decline, it’s a welcome change of pace.”